Then the disastrous story began: Shares were priced at $38, opened at $40, and then, within 10 market hours after the pricing, Facebook stock flailed. Technical glitches at the Nasdaq caused a delayed open, late executions and reports, and mispriced trades.

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A Facebook phone could be in the works, serving as the company's latest bold attempt to increase revenue and make money from its one billion users.

The social media giant sent out invites last week to a press event, "Come See Our Home on Android." Facebook Inc. (Nasdaq: FB) will host the event at its Menlo Park, CA headquarters Thursday.

Rumors state the mobile device will use customized software that's a version of Google Inc.'s (Nasdaq: GOOG) Android 4.2 OS. The software will dominate a user's home screen. Updates and information from a user's Facebook account will be posted constantly.

Industry insiders believe the company is working on the smartphone in collaboration with Taiwan's HTC. This is the second time the companies have collaborated on a Facebook-focused phone - with the first attempt only lasting a few months.

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LinkedIn Corp. (Nasdaq: LNKD) just reported fourth-quarter earnings that blew away Wall Street estimates, a nice addition to its already impressive resume -- and one that is making LNKD much more attractive than Facebook stock.

LinkedIn earned 35 cents a share, nearly triple the 12 cents earned in the same quarter a year ago. Net income soared 60% to $11.5 million, up from $6.9 million. Revenue jumped 81% to $304 million up from $168 million. Analysts were looking for 19 cents on revenue of $280 million.

U.S. markets accounted for 62%, or $189 million, of Q4 revenue. That was down 2% from the previous quarter. But international growth was robust, kicking in $114.6 million to LinkedIn's bottom-line.

CEO Jeff Weiner called 2012 a "transformative year."

"We have exceeded our own expectations by a wide margin," CFO Steve Sordello said during a conference call.

Shares surged $12.11, or some 10%, to $136.20 after hours Thursday following the report. The rally continued Friday with shares climbing another $26, or almost 21%, hitting an all-time high of $150.25 intraday.

Since its May 2011 initial public offering at $45, shares have more than tripled.

"Doesn't grasp the significance of so many users," one Wall Street insider opined--who happened not coincidentally to work for one of Facebook's investment bankers.

Since then the social media darling has fallen another 31% to nearly $22 a share. Ten weeks later, Team Hoodie hasn't done much to merit an upgrade either.

Sorry guys...Facebook is still only worth $7.50 a share - likely less.

Here's why.

The Cold, Hard Facts for Facebook

At the time I reasoned that Facebook's valuation simply didn't merit the 100 times earnings IPO price of $38 a share based on comparable figures from Google (Nasdaq: GOOG) and Apple (Nasdaq: AAPL).

But there were a host of other factors as well.

I cited falling revenues, a lack of control over the mobile market channel, increasing distrust from customers who were voting with their feet and the concurrent departure of major advertisers like GM which will cost Facebook an estimated $10 million a year in revenue alone.

I also posited the assumption that Facebook would be unable to maintain the 100% plus growth that many investors believed was baked into the proverbial cake.

Google couldn't. Apple couldn't. And both of them are real businesses.

That's the key...real businesses.

Fact is, Facebook still hasn't figured out what it wants to be when it grows up.

Despite the fact that CEO Mark Zuckerberg does have some excellent advisors, the company isn't going to be able to hide the fact that its "business" is nothing more than a colossal time-wasting collection of personal interest items for much longer.